Memory Crisis: The Chinese manufacturer YMTC expands production

YMTC (Yangtze Memory Technologies), leading Chinese manufacturer of NAND flash memories, is pursuing a broad strategy of industrial expansion.

According to sources close to the company, the Asian group plans the construction of two new production facilities, which will join a further factory whose inauguration is expected by the end of this year.

This operation will lead to a doubling of total capacity once all three new facilities are fully operational.

YMTC will double its production, from NAND-only to DRAM

Currently, the Wuhan-based company operates two plants capable of producing a total of 200,000 wafers per month. In steady state, each of the three new factories will guarantee an additional 100,000 wafers per month. The third facility, which has already seen completion of the works, will start up the lines in the last months of this year, with the prospect of reaching 50,000 wafers per month by 2027.

The expansion push by YMTC fits into a complex geopolitical landscape, marked by Beijing’s attempt to drastically reduce its dependence on foreign technologies in critical sectors.

Facing increasing restrictions imposed by the United States, which in December 2022 placed the company on the so-called Entity List, management has sharply intensified relationships with local suppliers.

The stages currently underway at the third Wuhan plant speak clearly: more than 50% of the equipment comes directly from Chinese companies.

Among these stands Advanced Micro-Fabrication Equipment (AMEC), a key partner for supplying complex equipment used in the vertical stacking of the various silicon layers.

Capabilities and Market Share

Despite being founded only in 2016 thanks to strong state funding, the company has made giant technical strides. The proprietary Xtacking 4.0 architecture is considered by analysts to be on par with the solutions offered by the sector’s historical leaders, such as the South Korean Samsung Electronics.

Commercially, although the domestic Chinese market remains the main outlet, YMTC reached last year a global share of 11.8% in the NAND segment.

These figures position the Asian group at the same level as Sandisk and close to direct competitors SK Hynix, Kioxia and Micron, which hold respectively 16%, 15.9% and 13.3% of the market. According to forecasts by UBS experts, the manufacturer’s market share will surpass the 14% threshold by early 2027.

The New Route toward DRAM Memories

The infrastructural expansion is not limited to consolidating positions in the NAND segment alone. The company is preparing a structured entry into the field of DRAM memories, essential components for temporary data processing inside devices such as smartphones and personal computers.

All three new plants in planning and underway will allocate a portion of their lines to this specific production.

Exact volumes will depend on development pace in the coming months. YMTC has already begun sending the first low-power DRAM samples (LPDDR) to some selected customers.

Feedback expected by the end of the current year will provide the definitive metrics to tune production and confirm the company’s official entry into a new segment.